Majority of Canadians expressed worries over their ability to balance their financial priorities
The pandemic has forced nearly half of Canadians to focus on short-term finances such as debt management, placing at risk other priorities such as building up their cash reserves.
In its latest Financial Independence poll, Royal Bank of Canada (RBC) found that 46% of Canadians consider servicing existing debt as their top financial priority, representing a six-point increase from March 2020. Meanwhile, saving for retirement fell by seven points to 49%, reaching its lowest rate in nine years.
Significantly, 71% expressed fears over their ability to balance short-term versus long-term financial priorities, while 47% believe that they have not saved enough.
Around 29% are anxious about how to be financially prepared for emergencies. Another 26% said that their cash flow has worsened since the COVID-19 pandemic took hold.
Approximately 54% of respondents admitted that they do not have a financial plan in place, and 71% said that they have not sought the assistance of a financial advisor in the past year. Of this group, 67% believe that they are behind in saving for their retirement years.
“As we see in our own client research, when people have a financial plan in place, they are more likely to contribute regularly to their savings – including building their retirement fund through investments within their TFSAs and their RRSPs,” said Michael Walker, vice president and head of RBC’s Mutual Funds Distribution and Financial Planning. “They also are more likely to have a stronger sense of how to balance day-to-day expenses while building a rainy day fund and saving for the longer term.”
